IDEAS home Printed from https://ideas.repec.org/a/bla/worlde/v34y2011ip725-740.html

Regional Liberalisation of Trade in Services

Author

Listed:
  • Innwon Park
  • Soonchan Park

Abstract

As the impact of trade in services on the current global financial crisis appears to overtake that of trade in goods, we propose to examine liberalization of trade in services through regional trade agreements (RTAs). The regional liberalization of trade in services is expected to generate significant welfare gains both in the services and goods sectors. However, the quantitative effect of RTAs under GATS (General Agreement on Trade in Services) Article V has not been sufficiently investigated. We attempt to fill this gap by applying a gravity regression analysis to four major services sectors—financial services, business services, communication services, and transportation services—while controlling for both country-specific and time-varying importer and exporter fixed effects. We find that (i) the RTAs under GATS Article V create services trade among members and do not divert services trade from nonmembers, but the trade-enhancing effect is sector-specific; (ii) the sector-specific trade-enhancing effect ranges from the highest in business services sector to the lowest in transportation services; (iii) the trade effect on aggregate services trade is weaker when we control for the time-varying multilateral trade resistance factor with the time-varying exporter and importer fixed effect, however, the sectoral effects show a reverse pattern; (iv) there is no anticipatory effect expected from services RTA negotiations, unlike the case of trade in goods; (v) there is a complementary relationship between goods and services imports; and (vi) the trade-enhancing effect of RTAs is stronger between developed members compared to the effect between developed and developing countries.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Innwon Park & Soonchan Park, 2011. "Regional Liberalisation of Trade in Services," The World Economy, Wiley Blackwell, vol. 34, pages 725-740, May.
    • Handle: RePEc:bla:worlde:v:34:y:2011:i::p:725-740
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a
    for a similarly titled item that would be available.

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Srinka Bose & Debashis Chakraborty, 2024. "Can Regulatory Barriers influence Mode 1 Services Imports? Cross-Country Empirical Results from Select Sectors," Working Papers 2474, Indian Institute of Foreign Trade.
    2. Philipp Lamprecht & Sébastien Miroudot, 2020. "The value of market access and national treatment commitments in services trade agreements," The World Economy, Wiley Blackwell, vol. 43(11), pages 2880-2904, November.
    3. Laurent Didier, 2018. "Do environmental provisions in regional trade agreements affect trade in services?," Economics Bulletin, AccessEcon, vol. 38(2), pages 733-750.
    4. Amélie Guillin, 2013. "Trade in Services and Regional Trade Agreements: Do Negotiations on Services Have to be Specific?," The World Economy, Wiley Blackwell, vol. 36(11), pages 1406-1423, November.
    5. Jie Wu & Zechu Luo & Jacob Wood, 2023. "How do digital trade rules affect global value chain trade in services?—Analysis of preferential trade agreements," The World Economy, Wiley Blackwell, vol. 46(10), pages 3026-3047, October.
    6. Gani, Azmat & Clemes, Michael D., 2016. "Does the strength of the legal systems matter for trade in insurance and financial services?," Research in International Business and Finance, Elsevier, vol. 36(C), pages 511-519.
    7. Borchert,Ingo & Di Ubaldo,Mattia, 2021. "Deep Services Trade Agreements and their Effect on Trade and Value Added," Policy Research Working Paper Series 9608, The World Bank.
    8. Gani, Azmat & Clemes, Michael D., 2013. "Modeling the effect of the domestic business environment on services trade," Economic Modelling, Elsevier, vol. 35(C), pages 297-304.
    9. Socrates K. Majune & Judy K. Kaaria & Evelyne N. Kihiu, 2023. "Determinants of intra‐COMESA trade in services," African Development Review, African Development Bank, vol. 35(4), pages 416-428, December.
    10. Laurent Didier, 2020. "Comparing the Impacts of Some North-North and North-South Trade Agreements on Trade in Services [Comparaison des impacts des accords commerciaux Nord-Nord et Nord-Sud sur le commerce des services]," Post-Print hal-03665971, HAL.
    11. Lin, Qi & Lin, Xi, 2023. "Unveiling the trade and welfare effects of regional services trade agreements: A structural gravity approach," Economic Modelling, Elsevier, vol. 127(C).
    12. Laurent Didier, 2020. "The Impact of Conflict on Trade in Services: A Sector-Level Analysis," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 62(1), pages 34-48, March.
    13. Chong Wha Lee & Soonchan Park, 2016. "Does Religious Similarity Matter in International Trade in Services?," The World Economy, Wiley Blackwell, vol. 39(3), pages 409-425, March.

    More about this item

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:worlde:v:34:y:2011:i::p:725-740. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0378-5920 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.